SIP Your Way to Wealth

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My Facebook status “who wants to earn money sitting at home” probably created more curiosity than i Phone 6. Within minutes, questions like “how is it possible” and “tell us the tips” came from doting and dedicated moms in that group.

Well, The Great Gruhini’s trick to earning money or rather creating wealth is in how well you invest whatever little or more you save every month and for how long you can keep investing that amount. With saving as low as Rs 500-1,000 a month, a mutual fundcan help you invest in stocks or other fixed income products. But you got to be patient and let it be invested for atleast 3-4 years. Be sure that this isn’t the money that you want to withdraw in six months or one year.

So here is a step by step guide to starting your own systematic investment plan (SIP) in a mutual fund.

A. Which Funds to Buy

Based on my personal investing experience, data on valueresearchonline.com and this survey, I would only recommend the following equity funds as they have shown good performance in past 10 years.

Investing for first time or after a long time? Keep these documents handy for a process known as Know Your Customer (KYC) form.

1. Identity Proof documents like PAN Card or Aadhar Card, Voter ID card or driving license (if you don’t have a PAN card). If you don’t have a PAN card you can invest, but only upto Rs49,999 (total of monthly SIPs or one time)

Keep originals and self attested copies of the above documents for verification

C. What Forms to Download

Click on the fund names mentioned above and you will find a list of forms. Download the following

1. A Key information memorandum (KIM) and application form: Print the pages of the application form only. Different forms are there for equity and bond schemes.

2. An SIP and Micro Sip form: Could be included in the KIM Form

3. Know Your Customer (KYC) Form: Could be included in the KIM Form. It is the crucial form as your application will not be accepted if your KYC process hasn’t been done. Attach the documents mentioned in B along with this form. The fund company will first do your KYC and then it will process your application form.

D. How to fill the forms

>In the Application Form, please don’t forget to write “DIRECT” in the box under ARN Code. Its lets the fund company know that you are investing directly and not through a broker or a agent.

>Mention the scheme name and plan correctly: Always opt for the growth option and the direct or the retail plan

> Don’t forget to mention the email id and internet transaction details as this will help you do any fund transaction sitting at home.

> In the SIP form: Click for micro SIP only if your total investment through all installments doesn’t exceed Rs 50,000. Else check the normal SIP box.

E. How do you submit the forms

All the forms can be deposited either at the fund’s investor service centre or at the back-end registrar firm designated by the fund office. Computer Age Management Services office (CAMS) is one such registrar. Click here to look out for a CAMS office in your area to submit the above forms. Please check on the mutual fund’s website for the name of its registrar and its offices.

About Rachna Monga Koppikar

Rachna aka your Great Gruhini is a finance writer with over a decade's experience in writing about personal finance matters with leading financial publications of India. As she studies to be a certified financial planner, she is also on a mission to make every woman a money savvy individual.
So shed your inhibitions. Get over your money worries with The Great Gruhini. Write to her at thegreatgruhini@gmail.com